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Consider the following information: Rate of Return if State Occurs State of Probability of State Economy of Economy Stock A Stock B Recession .21 .015
Consider the following information: |
Rate of Return if State Occurs | |||
State of | Probability of State | ||
Economy | of Economy | Stock A | Stock B |
Recession | .21 | .015 | .26 |
Normal | .56 | .095 | .16 |
Boom | .23 | .150 | .39 |
Requirement 1: |
Calculate the expected return for the two stocks. (Do not round intermediate calculations. Enter your answers as a percentage rounded to 2 decimal places (e.g., 32.16).) |
Expected return | |
E(RA) | ? % |
E(RB) | ? % |
Requirement 2: |
Calculate the standard deviation for the two stocks. (Do not round intermediate calculations. Enter your answers as a percentage rounded to 2 decimal places (e.g., 32.16).) |
Standard deviation | |
A | ? % |
B | ? % |
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